Documente Academic
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FIRST DIVISION
THE
DEPARTMENT
OF
HEAL TH,
represented
by
SECRETARY ENRIQUE T.
ONA, and THE FOOD AND
DRUG
ADMINISTRATION
(Formerly the Bureau of Food
and Drugs), represented by
ASSISTANT SECRETARY OF
HEALTH
NICOLAS
B.
LUTERO III, Officer-in-Charge,
Petitioners,
MAR 2 5 2015
- versus -
PHILIP
MORRIS
PHILIPPINES
MANUFACTURING, INC.,
Respondent.
x-----------------------------------------------------------------------------------------x
DECISION
PERLAS-BERNABE, J.:
Assailed in this petition for review on certiorari 1 are the Decision2
dated August 26, 2011 and the Resolution3 dated August 3, 2012 rendered
by the Court of Appeals (CA) in CA-G.R. SP No. 109493, finding grave
abuse of discretion on the part of petitioners the Department of Health
(DOH) and the Food and Drug Administration (FDA), then known as the
Bureau of Food and Drugs (BF AD), for denying respondent Philip Morris
Philippines Manufacturing, Inc.'s (PMPMI) permit applications for its
tobacco sales promotions.
Decision
The Facts
On November 19, 2008, PMPMI, through the advertising agency PCN
Promopro, Inc. (PCN), by virtue of Article 1164 of Republic Act No. (RA)
7394 5 or the Consumer Act of the Philippines, applied for a sales
promotion permit before the BFAD, now the FDA, for its Gear Up
Promotional Activity (Gear Up Promo). 6 The application included the
mechanics for the promotional activity, as well as relevant materials and
fees.7
With more than fifteen (15) days lapsing without the BFAD formally
acting upon the application, PMPMI then inquired about its status. However,
PMPMI was only verbally informed of the existence of a Memorandum
issued by the DOH purportedly prohibiting tobacco companies from
conducting any tobacco promotional activities in the country. On January 8,
2009, PCN requested8 the BFAD to formally place on record the lack of any
formal action on its Gear Up Promo application.9
Meanwhile, on November 28, 2008, PMPMI, through another
advertising agency, Arc Worldwide Philippines Co. (AWPC), filed another
application for a sales promotional permit, this time for its Golden Stick
Promotional Activity (Golden Stick Promo) which the BFAD, however,
refused outright, pursuant to a directive of the BFAD Director that all permit
applications for promotional activities of tobacco companies will no longer
be accepted. Despite inquiries, the BFAD merely advised AWPC to await
the formal written notice regarding its application.10
Eventually, in a letter 11 dated January 5, 2009, the BFAD, through
Director IV Leticia Barbara B. Gutierrez, M.S. (Dir. Gutierrez), denied
PMPMIs Gear Up Promo application in accordance with the instructions of
the Undersecretary of Health for Standards and Regulations, directing that as
of July 1, 2008, all promotions, advertisements and/or sponsorships of
tobacco products are already prohibited, based on the provisions of RA
921112 or the Tobacco Regulation Act of 2003.13
4
5
6
7
8
9
10
11
12
13
Decision
14
15
16
17
18
19
20
See letter of PMPMI, through its counsel, dated January 19, 2009; id. at 476.
Id. at 136.
Id.
Id. at 135-143. Penned by Secretary of Health Francisco T. Duque, III, MD, MSC.
Id. at 143.
Id. at 137.
See id. at 138-141.
Decision
21
22
23
24
25
26
Decision
Hence, the CA ruled that the DOH wrongfully arrogated unto itself
the authority given to the IAC-Tobacco to administer and implement the
provisions of RA 9211, which includes regulation of tobacco promotions.27
Dissatisfied, the DOH, through the Office of the Solicitor General
(OSG), moved for the reconsideration28 of the said Decision, which the CA
denied in a Resolution29 dated August 3, 2012, hence, this petition.
The Issues Before the Court
The essential issues to be resolved are: (a) whether or not the CA
erred in finding that the authority of the DOH, through the BFAD, to
regulate tobacco sales promotions under Article 116 in relation to Article
109 of RA 7394 had already been impliedly repealed by RA 9211, which
created the IAC-Tobacco and granted upon it the exclusive authority to
administer and implement the provisions thereof; and (b) whether or not the
CA erred in ascribing grave abuse of discretion upon the DOH when the
latter held that RA 9211 has also completely prohibited tobacco promotions
as of July 1, 2008.
The Courts Ruling
The petition is bereft of merit.
At the core of the present controversy are the pertinent provisions of
RA 7394, i.e., Article 116 in relation to Article 109, to wit:
Article 116. Permit to Conduct Promotion. No person shall
conduct any sales campaigns, including beauty contest, national in
character, sponsored and promoted by manufacturing enterprises without
first securing a permit from the concerned department at least thirty
(30) calendar days prior to the commencement thereof. Unless an
objection or denial is received within fifteen (15) days from filing of the
application, the same shall be deemed approved and the promotion
campaign or activity may be conducted: Provided, That any sales
promotion campaign using medical prescriptions or any part thereof or
attachment thereto for raffles or a promise of reward shall not be allowed,
nor a permit be issued therefor. (Emphasis supplied)
27
28
29
Id.
See Motion for Reconsideration dated September 20, 2011; id. at 408-432.
Id. at 91-97.
Decision
The DOH derives its authority to rule upon applications for sales
promotion permits from the above-cited provisions. On the other hand,
Section 29 of RA 9211 creating the IAC-Tobacco provides:
Section 29. Implementing Agency. An Inter-Agency CommitteeTobacco (IAC-Tobacco), which shall have the exclusive power and
function to administer and implement the provisions of this Act, is
hereby created. The IAC-Tobacco shall be chaired by the Secretary of the
Department of Trade and Industry (DTI) with the Secretary of the
Department of Health (DOH) as Vice Chairperson. The IAC-Tobacco
shall have the following as members:
a.
b.
c.
d.
e.
f.
g.
h.
i.
Decision
this much can be deduced from the lack of provisions in RA 9211 and its
implementing rules laying down the procedure for the processing of
applications for tobacco sales promotions permit. 32 As such, the DOH,
through the BFAD, retains the authority to rule on PMPMIs promotional
permit applications.
The Court agrees with the CA.
After a meticulous examination of the above-quoted pertinent
provisions of RA 7394 and RA 9211, the Court finds that the latter law
impliedly repealed the relevant provisions of the former with respect to the
authority of the DOH to regulate tobacco sales promotions.
At this point, the Court notes that both laws separately treat
promotion as one of the activities related to tobacco: RA 7394 defines
sales promotion under Article 4 (bm), while RA 9211 speaks of
promotion or tobacco promotion under Section 4 (l).
Sales promotion is defined in Article 4 (bm) of RA 7394, to wit:
Article 4. Definition of Terms. For purposes of this Act, the term:
xxxx
bm) Sales Promotion means techniques intended for broad
consumer participation which contain promises of gain such as prizes,
in cash or in kind, as reward for the purchase of a product, security,
service or winning in contest, game, tournament and other similar
competitions which involve determination of winner/s and which utilize
mass media or other widespread media of information. It also means
techniques purely intended to increase the sales, patronage and/or
goodwill of a product. (Emphases and underscoring supplied)
Id. at 55.
Decision
not occur but for the support given to it by or on behalf of the tobacco
manufacturer, distributor or retailer. It may also refer to the display of a
tobacco product or manufacturers name, trademark, logo, etc. on
non-tobacco products. This includes the paid use of tobacco products
bearing the brand names, trademarks, logos, etc. in movies, television
and other forms of entertainment. For the purpose of this Act, promotion
shall be understood as tobacco promotion[.] (Emphases and underscoring
supplied)
34
35
36
Charles M. Futrell. Just the Facts 101 Textbook Key Facts: Fundamentals of Selling, 11th Ed., 2015.
<https://books.google.com.ph/books?id=B8yJBAAAQBAJ&printsec=frontcover&source=gbs_ge_sum
mary_r&cad=0#v=onepage&q=promotion&f=false > (visited February 28, 2015).
Rob Peters. The Social Media Marketing Handbook Everything You Need to Know About Social
Media, 2012. <https://books.google.com.ph/books?id=QUQQBwAAQBAJ&pg=PA43&lpg=PA43&d
q=to+provide+added+value+or+incentives+to+consumers,+wholesalers,+retailers,+or+other+organiza
tional+customers+to+stimulate+immediate+sales&source=bl&ots=RA0UkAA8Mt&sig=knt2-rN89xQ
ObChQgYYPBhfw108&hl=en&sa=X&ei=_3U0Ve6xGMPFmwXroCgBA&ved=0CCgQ6AEwAg#v=
snippet&q=to%20provide%20added%20value%20or%20incentives%20to%20consumers&f=false>
(visited April 20, 2015).
Id.
Supra note 33.
Decision
38
39
40
41
42
43
See Hasan, K. and Khan, R. (2011). Building International Brand Through Promotional Strategy.
University of Skovde, Sweden. <http://www.diva- portal.org/smash/get/diva2: 453926/ATTACHMEN
T01> (visited April 20, 2015).
Kurtz, Dave. (2010). Contemporary Marketing Mason, OH: South-Western Cengage Learning, cited in
<http://ir-library.ku.ac.ke/handle/123456789/6162?show=full > (visited April 20, 2015).
See Supra note 34.
Rollo, pp. 117-121.
Id. at 120.
Associated Communications & Wireless Services-United Broadcasting Networks v. NTC, 445 Phil.
621, 643 (2003).
SECTION 2. Policy. It is the policy of the State to protect the populace from hazardous products and
promote the right to health and instill health consciousness among them. It is also the policy of the
State, consistent with the Constitutional ideal to promote the general welfare, to safeguard the interests
of the workers and other stakeholders in the tobacco industry. For these purposes, the government shall
Decision
10
44
45
institute a balanced policy whereby the use, sale and advertisements of tobacco products shall be
regulated in order to promote a healthful environment and protect the citizens from the hazards of
tobacco smoke, and at the same time ensure that the interests of tobacco farmers, growers, workers and
stakeholders are not adversely compromised.
See Nieves v. Duldulao, G.R. No. 190276, April 2, 2014, citing Jalosjos v. Commission on Elections,
G.R. No. 205033, June 18, 2013, 698 SCRA 742, 762.
See Inter-Agency Committee on Tobacco Memorandum Circular (I-ACT MC No. 1 s. 2008), wherein
the DOH was designated as pilot agency in the implementation of provisions on Healthful
Environment and Advertising and Promotions.
Decision
11
SO ORDERED.
bi-ltuJJ
ESTELA ~JPERLAS-BERNABE
Associate Justice
WE CONCUR:
~~~&u
EZ
CERTIFICATION
Pursuant to Section 13, Article VIII of the Constitution, I certify that
the conclusions in the above Decision had been reached in consultation
before the case was assigned to the writer of the opinion of the Court's
Division.